What might interest the market in trading this week.
The market activity has slowed with pressure remaining on the GBP, the commodity currencies doing better. Of course we are in the middle of August. Traders are still on holiday. So markets are subject to liquidity flows. We have to be cognizant of the trading environment. What does that mean? Well anything can happen. We have seen markets rally on interest rate cuts. We have seen oil price volatility whip prices around. The stock market in the US has seen a "meltup" - or that is what they are calling it - which has seem steady rises and an occasional move into risk. Debt markets are pretty much still on a downward track, with the "carry trade" idea being the thought process.
Anyway, what fundamental events or releases catch my eye.
1. UK retail sales. On Thursday the UK will release July retail sales with the expectations for a +0.1% rise. This comes after a sharp -0.9% decline in June. Economists are speculating that the weather played a role in the gain. There is also speculation that there was a spike up in summer tourists after the sharp fall in the GBPUSD from 1.50 before to 1.30 after Brexit. That is a 13.3% discount for those living on the continent. We will see how it all shakes out. The release will take place at 4:30 AM ET/0830 GMT
2. US CPI. ON Tuesday, US CPI will be released at 8:30 AM ET/1230 GMT. The expectations are for no change in July for the headline vs 0.2% increase in June. THe Ex food and energy component is expected to rise by 0.2% - equal to the gain last month. YoY the consumer inflation is expected to rise 0.9% on the year vs 1.0% last month. The Ex food and energy is expected to stay steady at 2.3%. What might kick start the market? With employment at full employment, the Fed officials (and market) keeps looking for signs of inflation to pick up. Well we saw a disappointing retail sales last week. Oil prices are up and down. Consumers are slowing purchases of "stuff" and spending more on services. Fed officials seem to be more tolerant of inflation so if the number is to impact the dollar in a positive way, it would need to see something bigger than 0.0% (even if ex food and energy is +0.2%).
3. US FOMC meeting minutes. The Fed kept rates unchanged once again but more incite into the Fed thinking will be eyed on Wednesday at 2 PM ET/1800 GMT.
4. UK CPI Tuesday 4:30 AM ET/0830 GMT. The CPI is expected decline in July by -0.1% while YoY is expected to remain steady at +0.5%. The Core YoY is expected to remain steady at 1.4%. There has been stories of increases in the price of imported goods as a result of the Brexit. Whether that translates into something in the broad measure of prices will be eyed.
5. Australia employment. The Australian employment numbers for the month of July will be released on August 17 in the US at 9:30 PM ET. GMT time will be August 18 at 0130 GMT. The expectations for the employment change is +10K vs +7.9K. The Unemployment rate is expected to come in at 5.8% unchanged from the prior month.